How China will Overtake the World –Robin Trehan

FC Member Blog

BY Robin TrehanThu Oct 15, 2009 at 12:07 PM

This blog is written by a member of our blogging community and expresses that member's views alone.

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There are various reasons why
many believe that China will overtake the U.S. and the rest of the world within
the next 10 years or so. Over these past couple of decades, China has risen
extensively economically. Their GDP has grown 7 to 10 percent since the 80s and
there doesn’t seem to be an end in sight. The question doesn’t really seem to
be whether China will overtake the U.S., but it’s a question of when. Right
now, the U.S. is the world power because everything (meaning oil) is traded in
American dollars. The reason why it’s in the dollar currency is because
majority of the oil companies are owned by the U.S. and we are the largest
consumers, producers and exporters of oil. Now, this could soon all change --
some are speculating that the oil will soon be traded in the Chinese renminbi.

China is steadily on the rise
as the U.S. is facing one of the worst recessions in its history. Even Robert
Zoellick, the president of the world bank, said that the current financial
crisis may show that there is a change taking place in economic power
relations. This concept is also probably weighing in the minds of various
Western policy-makers. Apparently, the recession of the Americans has helped to
accelerate the economic growth of China. Word has it that China will continue
to grow at a rate over 10 percent during the next decade and America at less
than 2 percent. It only makes sense that China will become the world’s largest
economy and creditor nation. This position was once that of America in the
1950s. It is also predicted that China will become the largest consumer of oil,
which would help to push oil and other commodities into a “bucket” of
currencies.

The distressed real estate
market in the U.S. and the rest of the world is catching the eye of China. They
are planning to buy a billions of dollars worth of real estate from the U.S.
and in countries within the Middle East and Europe. Being able to purchase real
estate well below value will allow lots of money to be made some years from now
when the real estate market rises again. Owning that much property in leading
countries will put China’s hands in a little bit of everything. Maybe if the
U.S. stopped debt spending and learned that a penny saved is a penny earned, we
wouldn’t owe as much money and would be able to get out of the situation that
we’re in. China has been patient and as the fortune cookie says, “good things
come to those who wait”.

Robin Trehan is management
and financial expert. More information on him can be found at www.creditcapitalfunding.com
www.businesscreditfunding.com